Recruitment Matters - October 2018

THE VIEW AND THE INTELLIGENC E

Our Future of Jobs follow up P2 BIG TALKING PO INT

Salaries and benefits P4-5 LEGAL UPDATE

RECRUITMENT MATTERS

How important are references? P6 Issue 66 October 2018

PRO DUC TS AND TR AINING

What’s coming up? P8

E U RO P E

Falling employer confidence highlights need for smart immigration policy D

ipping employer confidence has bolstered calls for a smart new immigration system.

Employers’ confidence in the prospects for the UK economy turned negative in August, according to the Recruitment & Employment Confederation’s JobsOutlook report.

The balance of those seeing a positive outlook as opposed to a negative one was a net -1, a fall of 7 points since July.

Despite the deterioration in confidence in the economic outlook, employers’ confidence in making hiring and investment decisions in their own businesses remained in positive territory with a net balance of +15, only falling by 1 point since July.

This may have been driven by ongoing concern about candidate availability with employment rates high. Half (50%) of UK employers expressed concern this quarter over the sufficient availability of candidates for permanent jobs – anticipation of shortages was most

@RECPress RM_October_2018-NEW.indd 1

heightened in relation to construction skills.

“A shortage of available candidates in many areas of the economy means employers are having to work harder to bring in key staff – with many sectors, such as drivers and food supply, fearing they may be hit hard by future changes to the UK’s mobility deal with the EU,” says REC chief executive Neil Carberry.

The report was buttressed by August’s ONS migration statistics, that found fewer EU migrants were coming to the UK. CIPD’s senior labour market analyst Gerwyn Davies says the numbers boost calls for a new approach to immigration policy.

“At a time of record low unemployment and mounting recruitment and retention pressures, it is sensible that controls on migration from outside the EU are loosened to take the heat out of the tightening labour market,” he says.

The report backs up the REC’s call for an immigration system not based on “arbitrary quotas” but the contribution individuals make to the UK economy.

www.rec.uk.com 11/09/2018 15:28

L E A D I N G T H E I N D U S T RY

the view...

It’s up to everyone to talk up recruitment, says NEIL CARBERRY, REC chief executive

I

have been asking myself how we tell the stories of recruitment in the best way possible.

A core role of the REC is highlighting the contribution recruiters make to UK prosperity – in both government and the media. Fantastic recruitment businesses all over the country are making a real difference to people’s lives and companies’ performance.

Economic data supports the case for what we do – our own research shows that almost eight in 10 UK employers are satisfied with the recruitment agencies they used in the last two years. Employment rates are high and candidate feedback is strong.

The facts are on our side. And in influencing public policy and debate – on issues like skills, regulation, tax and Brexit – that is invaluable, right? Well, yes – up to a point.

The nature of modern politics and fast-paced technological changes mean the public debate about our sector isn’t always based upon the realities of life for workers and companies around the country.

We need to do more than churn facts. If we’ve learned anything from the political debate of the past few years, facts alone aren’t persuasive – and narrow self-interest never is. Our challenge is to tell an engaging story about the value we create, the lives we change and the experience of people we place into work.

A clearer story about the value of what we do and a focus on improving recruitment practices will make the sector’s voice louder, and ensure we are seen as the essential service we are. It will prompt policymakers to engage and allow us to be persuasive. But it will require all of us to work together.

If you want to keep up to speed with all things recruitment then follow me on Twitter @RECNeil

2 RECRUITMENT MATTERS OCTOBER 2018

RM_October_2018.indd 2

What does the follow up to the Future of Jobs report hold for the industry? asks TOM HADLEY, REC director of policy and professional services HADL EY ’ S C OMMENT

Let’s own the future We have engaged with more than 1,000 recruiters since launching our ‘Future of Jobs’ commission report. Our follow up report ‘Recruitment 2025’ identifies four areas the industry can build on to thrive in the changing employment landscape.

1) Looking ahead – nurturing a future-focused mind-set Although recruitment will always be about the ‘here and now’, we must develop a future-first mindset. Recruitment can drive innovation and harness new technology, with 70% of REC members surveyed saying they’ve adopted this mindset to A1 and tech.

2) Looking out – forging a new identity Real opportunities exist to expand the types of service recruiters offer and forge new relationships. It bodes well that 81% of employers are satisfied with the agencies they use. Helping clients with their strategic workforce planning will involve making change happen on diversity and social mobility and will underline the industry’s role in ensuring that a future UK jobs market is all-inclusive.

3) Looking in – building future skills and leadership An evolving economic landscape is already impacting on the type of skills, competencies and leadership within our industry. Recruiters say these internal changes must accelerate to reflect seismic changes to the world of work. Investing in skills and building a new generation of leaders will become pivotal.

4) Looking to make a difference – becoming Future of Jobs ambassadors Recruitment is an essential part of the UK economy. Bringing the education and labour market together will be critical. Our network of ‘Future of jobs ambassadors’ will help to make this difference.

As the pace of change accelerates, clients and candidates will need help to navigate the complexity of a constantly evolving landscape.

This is where we come in: let’s own the future of jobs.

You can follow Tom on Twitter @hadleyscomment

www.rec.uk.com

11/09/2018 12:09

6%

the intelligence...

WITH REC SENIOR RESEARCHER, MARK HARRISON

T

he REC’s latest research report shows it’s a good time to be a recruiter. In ‘Attract and retain top talent: pay and benefits in the recruitment sector’, the REC research total annual earnings team have explored remuneration rise for consultants and rewards among recruitment managers and consultants across the UK and compared them with the results of our 2015 pay and benefits rise for managers report ‘Planning for Growth’.

For both managers and consultants, remuneration has been increasing. Our latest survey shows that for consultants, the average basic salary has increased 6% from £23,810 three years ago to £25,341 today. For managers, there has been a 3% increase from £38,170 to £39,158. When considering non-financial benefits, the distribution of entitlement to perks between managers and consultants is fairly evenly spread, though there is a skew towards managers being more likely to be entitled to most benefits.

Overall, half of the recruiters in our survey were satisfied with their pay and benefits, compared to

10% 1%

8.5%

4.5%

PERMANENT AND TEMPORARY BILLINGS UP, YOY, ACROSS H1 2018

Temporary H1 2018

Permanent H1 2018

Temporary turnover and permanent billings versus last year % – average across H1 2018, for the median recruiter

www.rec.uk.com

RM_October_2018.indd 3

a quarter who were dissatisfied.

Unsurprisingly, those with the highest earnings had the highest levels of satisfaction.

Gender pay reporting has highlighted gender pay gaps across a range of sectors, typically in favour of men. Unfortunately, recruitment is no exception to this. When looking at mean total earnings, our survey found a gender pay gap of 14% in favour of men among consultants and a gap of 10% in favour of men among managers. Men were also more likely to be entitled to any given benefit with the key exception of female managers being more likely to be entitled to flexible working than male managers.

14%

gender pay gap in favour of men among consultants

The latest real-time information from the RIB Index shows that both permanent and temporary billings were proportionally higher in H1 2018 than those generated in H1 2017.

Taking an average of the median recruiter’s monthly

Our latest survey shows that for consultants average basic salary has increased 6 per cent from £23,810 three years ago to £25,341 today

When it came to actually using flexible working benefits, over half of all women in our survey had used one method of flexible working in the last 12 months, compared to a third of men.

To access our latest report in full, including recommendations for leaders of recruitment businesses of all sizes on how to attract and retain managers and consultants, visit www.rec. uk.com/newsand-policy/ research/latestresearch/attractand-retain-toptalent.

10%

gender pay gap in favour of men among managers

performance across H1 2018, turnover from temporary placements was 8.5% higher whilst billings from permanent placements were up 4.5% year-on-year (YoY).

With temporary margins remaining buoyant for the median RIB recruiter across

H1 2018, the uptick in turnover will be generating notable additional NDR yield.

Whilst proportionally lower, the improved performance within perm billings is even more notable, however, due to the fact that average margins have deteriorated YoY.

BELINDA JOHNSON runs employment research consultancy Worklab, and is associate knowledge & insight director of Recruitment Industry Benchmarking (RIB) – part of the Bluestones Group. The RIB Index provides bespoke confidential reports on industry benchmarks and trends. See www.ribindex.com; info@ribindex.com: 020 8544 9807. The RIB is a strategic partner of the REC.

OCTOBER 2018 RECRUITMENT MATTERS 3

11/09/2018 12:09

N E W R E P O RT

big talking point

Carrots and salary Salary and benefits packages remain important to consultants and managers. If your company is not regularly reviewing your offer against market trends and your competitors’ packages, you may risk losing good staff, failing to attract new talent or both.

The REC’s ‘Attract and retain top talent – Pay and benefits in the recruitment sector’ report is the latest survey of salary and benefits in the recruitment industry.

Recruitment Matters looks at the big recommendations. t is a good time to work in the recruitment industry. Despite political disruptions and some economic uncertainty around Brexit, combined with a declining availability of candidates, the industry continues to grow and respond to employers’ labour needs.

As in most businesses in the service sector economy, employees are the most fluid asset of recruitment agencies. As competition for talent escalates, the recruitment industry must focus on how to attract and retain staff.

The REC’s ‘Attract and retain top talent – Pay and benefits in the recruitment sector’ report outlines six ways your recruitment agency can keep your consultants and managers paid and happy.

post. Make your staff who are new to the industry or to your business understand how their total rewards might potentially change as they improve their skills and performance.

Being open and transparent about the pay trajectory individuals could be on at your firm will help with candidate attraction, as well as build loyalty once in post.

Be transparent

Flexible work is more important than ever

The recruitment industry rewards experience and longevity with significant boosts in total earnings coming after a few years in

4 RECRUITMENT MATTERS OCTOBER 2018

RM_October_2018-NEW.indd 4

Be open about progression As well as the opportunity to increase their earnings, recruiters want to know there are clear opportunities for progression when they take a job. Advertise to external candidates and promote to your current staff the opportunities you have for them to advance in their careers and develop their skills within your business.

Flexible working is an important draw for both consultants and managers and more

www.rec.uk.com

11/09/2018 17:15

GENERAL ELECTION

2015, although it is still only available to a minority of respondents to the REC’s survey. Only a quarter of respondents report their employers offer parental leave beyond the statutory minimum.

than half say it is not something they are entitled to in their current job. For owner/managers of recruitment agencies who are currently unable to offer increased pay packages or higher bonuses, being pro-active about offering flexible work opportunities is a low-cost way to make your company and its culture attractive to new candidates, as well as a place current staff will want to stay. If this is something you already offer, be sure to advertise the fact prominently when recruiting.

Mind the gender gap

Family first Other family-friendly benefits are still not universally offered. This presents an opportunity for some agencies to set themselves apart from competitors by being more generous in their entitlements. The number of recruiters reporting that employers offer childcare assistance has increased since

“The area of real concern in this year’s survey remains the persistent gender pay gap, which does not appear to have reduced since our last report. All large employers are now required by the government to report this. But what matters is what we do next. Reviewing pay and bonus policies to ensure they are gender neutral is vital, as is ensuring men and women have equal opportunity to grow into more senior roles” Neil Carberry, REC chief executive

www.rec.uk.com

RM_October_2018-NEW.indd 5

The survey suggests that not only are women’s basic salaries lower than men’s on average, but that the gap increases when discretionary payments such as bonuses and commission are taken into account.

Agencies should be monitoring pay and rewards schemes to ensure they are applied equitably and that any discrepancies in pay between men and women are addressed.

REC members can download the full report from www.rec.uk.com/toptalent

OTHER HIGHLIGHTS EARNINGS UP Since the last survey in 2015, overall earnings have risen, with both managers and consultants enjoying above inflation pay rises in the last financial year.

HIGHEST IN THREE YEARS The average pay rise for both managers and consultants in the last financial year was the highest in the past three years.

LONGEVITY A FACTOR The recruitment industry rewards experience and longevity with significant boosts in total earnings coming after a few years in post.

THREE MOTIVATORS The top three considerations for recruiters when choosing a new job are pay, followed by personal development opportunities, and flexible work practices.

OCTOBER 2018 RECRUITMENT MATTERS 5

11/09/2018 17:15

REFERENCES

legal update

Let’s talk references

By KAREN AFRIYIE – Legal and compliance adviser at the REC efore an individual engages on an assignment with a client, or is offered a permanent role, employers may require a number of references from that individual. But what are the rules regarding a former employer’s obligation to provide a reference? Typically, there is no legal obligation for an employer to provide a reference, except in the financial sector where regulatory references are mandatory. Therefore, employers in other sectors can refuse to provide a reference, unless they previously contractually agreed to do so.

Under Regulation 22 of the Conduct of Employment Agencies and Employment Businesses Regulations 2003, employment

B

“There is no legal obligation for an employer to provide a reference”

RECRUITERS AND TODAY’S NEW WORKPLACE REALITY, ALEX PARKER, EXCELREDSTONE

More people than ever before are working more flexible hours, with a recent YouGov survey showing only six% of people in the UK work the traditional 9 to 5, with almost half the respondents working flexibly, such as job sharing or compressed hours.

Is it time for recruiters to take a different look at the office worker?

Agencies adopting a flexible working practice can use this to attract and retain top talent and promote a

6 RECRUITMENT MATTERS OCTOBER 2018

RM_October_2018-NEW.indd 6

agencies and employment businesses have to comply with additional requirements when introducing or supplying jobseekers that work with vulnerable people.

While recruiters find candidates that meet all the requirements for a role, they must also obtain two references from people not related to them. Recruiters also need to obtain consent from a referee to disclose the reference to the hirer. If recruiters can’t obtain references they must inform the hirer that that have taken all reasonable and practical steps to fully comply with Regulation 22 requirements, but have been unable to do so.

A common question is whether the individual’s consent is required before obtaining and providing a

reference – the simple answer is yes. Under the General Data Protection Regulations (2016/679EU) (GDPR), as the reference will contain personal data, the employer will need the individual’s consent which must be freely given. However, under the GDPR, recruiters and employers can determine whether there is an appropriate lawful basis to process the individual’s data, for example: • there is a contractual obligation; • there is a legal obligation; • they could rely on the consent of the data subject; or • they may rely on a legitimate interest.

Another frequently asked question is whether a confidential reference must be disclosed if a subject access request is made.

Although there is a specific provision in the Data Protection Act 2018 that relates to confidential references, the position is not entirely clear.

The REC is currently communicating with the ICO to identify the scope and application of this section.

Dealing with references should be a straight forward process in recruitment. However, due to statutory obligations, it is important to be aware of any requirements and/or limitations to ensure that neither party’s interests are at risk.

healthy work/life balance.

But how can you give staff more freedom and the tools they need to do their jobs without sacrificing productivity or security?

The answer is technology.

A successful, flexible remote workforce need access to business applications and data from anywhere and any device – advanced communications tools and collaboration spaces to keep productivity levels up.

Cloud services like virtual desktops, voice and video

conferencing, instant messaging and file sharing give employees the ultimate freedom to work wherever and whenever they need to.

With an IT managed service provider, like ExcelRedstone, looking after your IT, implementing flexible working can also be hasslefree and cost-effective.

ExcelRedstone is the REC’s IT service provider of choice.

For more information visit www.excelredstone.com/ REC.

www.rec.uk.com

11/09/2018 17:15

I N S P I R AT I O N To keep up to date with everything the Institute of Recruitment Professionals is doing, please visit www.rec-irp.uk.com

ASHLEIGH WRIGHT is the

leader at Oyster Partnership

What sector do you recruit in?

What sector do you recruit in?

What are you looking forward to?

I originally specialised in the public sector for Town Planning, which I enjoyed, however after a year I decided I wanted to start something from scratch. I now specialise in the contracting market of Environmental Health, which strangely isn’t all that involved with the environment in the traditional sense.

I cover a really varied profession, which includes Food Safety, Licensing, Environmental Protection and Housing Standards, all of which have their own challenges and niche details.

Expanding our team even further after we have experienced a successful first year. I am really looking forward to the challenge of managing an even bigger team and seeing how far we can grow and develop – I find this to be hugely rewarding.

What makes you unique?

We are the only consultancy in the North East region to be REC Audited, which is the gold standard for recruitment.

This proves we are committed to providing excellent service delivery to both clients and candidates, and is definitely something we pride ourselves on!

What are some of your big challenges?

Increased competition which means margins are continually being eroded. And it’s always been a challenge to recruit excellent

RM_October_2018.indd 7

WILL SHIPLEY is a team

commercial director of Westray Recruitment Consultants

Professional, Commercial, Technical & Engineering and Industrial & Manufacturing

www.rec.uk.com

Q&A

What I know

BEHIND THE SCENES AT THE INSTITUTE OF RECRUITMENT PROFESSIONALS

recruiters – ironic, isn’t it?

What are you looking forward to?

We are opening our second office in October, which will be based in Teesside. This is just the start of a wider growth plan that we have, but I can’t give too much away at the moment!

What advice would you give a recruitment entrepreneur/ leader starting out?

Always stick to your guns. There’s a lot of competition out there but never devalue the service you offer by competing on price.

Also, don’t be scared to walk away from clients who are difficult to work with. There’s always going to be other clients who appreciate what you do and who will value a true working partnership.

What are some of your big challenges?

Researching a new sector, whilst stepping up and managing a team, was difficult initially but the success we are building makes it all worthwhile!

What advice would you give a recruitment entrepreneur/leader starting out?

1. Be patient, it takes time to build the sector that you specialise in. Your business relationships are vital, so communication is key!

2. Always be willing to listen and learn from those around you.

Whether they are more senior or more junior than you, you never stop learning in this job!

OCTOBER 2018 RECRUITMENT MATTERS 7

11/09/2018 12:11

W H AT ’ S C O M I N G U P ?

Join us at the Recruitment Agency Expo in Birmingham 3-4 October, National Exhibition Centre, Birmingham The REC is excited to support the sixth annual Recruitment Agency Expo in Birmingham.

With over 14 hours of expert content spread over two days and 80+ exhibitors on the show floor, Recruitment Agency Expo is the premier annual event for the recruitment industry.

Join us at the REC & IRP stand, and make sure you hear REC chief executive Neil Carberry talk about the future of recruitment on 4 October.

The Recruitment Agency Expo is free for all REC and IRP members to attend.

Register now on the events section of the REC website – www.rec.uk.com

How taking an IRP qualification helped my career We interviewed our very own JOANNE RANDALL about how the Level 3 Certificate in Recruitment Practice took her career to the next level What have you learned from passing the Level 3 Cert RP? Taking the Level 3 was a brilliant refresher for me into recruitment and the processes involved.

It has strengthened my knowledge of the legal and ethical requirements of the industry, as well as provided me with some great sales methods.

Who would you recommend this course to?

Anyone in recruitment who is looking to enhance their professional skills and taking the next step in their career in recruitment. If you’re a recruiter, this course will help you out – it did me!

What skills did you gain?

This course helped me develop and adapt my client relationships style, as well as provided me with even more of a strategic approach to the sales cycle.

How has this course helped you progress in your professional career?

Not only has this course helped me develop my own skills, it has given me an even better understanding of what all our students go through. It’s been years since I sat an exam so that opened my eyes again, but to sit the exam

RECRUITMENT MATTERS

The official magazine of The Recruitment & Employment Confederation Dorset House, 1st Floor, 27-45 Stamford Street, London SE1 9NT Tel: 020 7009 2100 www.rec.uk.com

8 RECRUITMENT MATTERS OCTOBER 2018

RM_October_2018.indd 8

with so many others, it was really rewarding!

Now I have my CertRP, I am able to support our members far better and continue to develop my recruitment knowledge here at the REC.

What feedback would you give to your trainer?

Having taken the fast-track course, I had the opportunity to attend a two-and-a-half day workshop. It was an intense refresher for the exam and really helped us all prepare better. The one bit of feedback I would suggest is for all of the students to have more time testing each other. I found working with other students really helpful and things stuck better in my mind!

What have been the best ‘take homes’ others have got from this course?

I’ve become more effective in my day-to-day tasks at work and have been able to analyse sales opportunities with more structure.

It’s increased my passion for the industry and I can’t wait to share that with all of our future students. Not to mention the free IRP membership I got for the duration of the course plus 12 months after it, too.

Find out more about the Level 3 Cert RP at www.rec-irp.uk.com

Membership Department: Membership: 020 7009 2100, Customer Services: 020 7009 2100 Publishers: Redactive Publishing Ltd, Level 5, 78 Chamber Street, London E1 8BL Tel: 020 7880 6200. www.redactive.co.uk Editorial: Editor Michael Oliver michael.oliver@redactive.co.uk. Production Editor: Vanessa Townsend Production: Production Executive: Rachel Young rachel.young@redactive.co.uk Tel: 020 7880 6209 Printing: Printed by Precision Colour Printing © 2018 Recruitment Matters. Although every effort is made to ensure accuracy, neither REC, Redactive Publishing Ltd nor the authors can accept liability for errors or omissions. Views expressed in the magazine are not necessarily those of the REC or Redactive Publishing Ltd. No responsibility can be accepted for unsolicited manuscripts or transparencies. No reproduction in whole or part without written permission.

www.rec.uk.com

11/09/2018 12:11